CBX Weekly Newsletter // 22 April 2020
- Bitcoin Dips Below $7K
- Tether has a $7 Billion day
- Dai Lending Rates Rise to One-Month High on #DeFi Platform Compound
Bitcoin Dips Below $7K
The price of West Texas Intermediate oil futures went into negative territory for the first time ever as Bitcoin prices merely shrugged at the turmoil in the oil markets, slipping 4.4% on Monday.
The price for 1 BTC fell below $7,000, eventually dipping to around $6,900. However, the world’s most famous cryptocurrency was then able to return to the $7,000 level before large amounts of selling volume at 18:00 UTC pushed prices back to $6,800.
Ethereum (ETH) slipped 5.8 percent. Large losers include EOS (EOS) dropping 8.9%, and BTC SV (BSV) down over 6%. Although some altcoins such as Stellar (XLM) managed to close the day in the green.
Volume has been also declining in the cryptocurrency industry as traders wait for a 4-year event called the Halving, which will halve the supply of Bitcoin that miners receive in less than 20 days.
This event is believed to be a bullish factor in the price of Bitcoin in the long term, however, traders believe that it’s already “priced-in”
Tether breaks $7 billion
The market capitalization of tether (USDT), the largest stablecoin in the cryptocurrency markets, surpassed $7 billion this past week, which is more than double where it was a year ago.
Over 74% of all bitcoins traded on major exchanges are done against tether, according to data site CryptoCompare.
Tether is the most easily accessed USD-proxy stablecoin, so investors prefer a faster way to get Dollar exposure rather than converting into fiat and paying high commissions.
Dai Lending Rates Rise to One-Month High on #DeFi Platform Compound
Interest rates have spiked for deposits of dai, the U.S. dollar-linked stablecoin, on the decentralized finance (DeFi) platform Compound, according to Coindesk.
The annual percentage rate a user would earn by lending dai on the platform rose above 14% which is the highest level since March 16, according to Codefi Data, a unit of Ethereum startup ConsenSys.
Dai, a stablecoin issued by the MakerDAO protocol, is designed to maintain 1:1 parity with the dollar. Its value is backed by ether and other cryptocurrencies that are locked up in a smart contract, the Maker collateral vault. However, dai has been trading above $1 for nearly two months.
Dai began trading above $1 at the end of February and rose as high as $1.25 on March 12.
The unprecedented rise was caused by the global dash for cash, mainly U.S. dollars, triggered by the relentless coronavirus-led sell-off in the traditional markets.
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